Cairns production up 700 percent

Cairns

Cairns Holdings secured a US$1 million loan from the Distressed Industries and Marginalised Areas Fund for capital expenditure and working capital requirements.

FOOD and beverages giant, Cairns Holdings says production has increased by 700 percent after the new investor, Takura Capital, injected US$30 million in fresh capital.

Cairns Mutare general manager, Joseph Mavhu, told the Financial Gazette last week, on the sidelines of the just ended Buy Zimbabwe Summit held in Mutare, that the company was positioned for major growth.

“Cairns Holdings is now ready for massive growth after we invested in our plants in Harare and Mutare. We have also embarked on a massive out grower programme meant to feed our factories with raw materials coming from this programme. This has seen production going up 700 percent since the new investor came on board,” said Mavhu.

After facing operational challenges, Cairns Holdings was placed under judicial management in 2012 but that order was cancelled and the company was successfully handed over to Takura Capital early this year.

Takura snapped a 63 percent stake in Cairns previously held by the Reserve Bank of Zimbabwe through its investment vehicle, Finance Trust.

This was after South African investor Vesari Global failed to commit to investing by December 2014, a year after negotiations had started.

Other shareholders in the company include Cyrus Holdings with 9,42 percent, Zimcor Limited (4,43 percent), Cairns Holdings’ Workers Trust (4,28 percent) and Stanbic Nominees (2,22 percent).

Recently, Cairns Holdings secured a US$1 million loan from the Distressed Industries and Marginalised Areas Fund (DIMAF) for capital expenditure and working capital requirements.

DIMAF is a US$40 million revolving fund set up jointly by government and Old Mutual in 2011 with the objective of resuscitating ailing companies in the country.

Each party contributed US$20 million. The money is disbursed through Old Mutual’s banking subsidiary Central African Building Society.

The DIMAF funds were to acquire new equipment from China and Europe. The funds come as a welcome boost to the company given the challenges it has been experiencing.
Cairns now plan to resume exports by next year after its capacity utilisation from seven percent to about 40 percent. It expects to improve capacity further to 70 before the end of this year. The company is also planning to revive its pasta manufacturing plant in Bulawayo which was closed several years ago due to viability concerns.

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